A proposal to turn the former Kmart building into a Public Storage self-storage facility while filling the remaining property for a Raising Cane’s Chicken Fingers, Dutch Bros Coffee shop, and Quik Stop convenience store and gas station, was approved by the Ceres Planning Commission on Monday evening.

Newly installed Commissioner Daniel Martinez supported the project as did Commissioners Bob Kachel, Gary Del Nero and Dave Johnson. Laurie Smith was absent.

The development proposal for the northeast corner of Hatch Road and Herndon Avenue required a Conditional Use Permit (CUP) and approval of a vesting tentative parcel map to create six commercial zoned parcels out of the single 9.02-acre site.

In August the city indicated that it was working with a developer to reuse the 84,000-square-foot Kmart building which has been vacant for three years. The building was constructed in 1976.

City officials supported the project but were disappointed that a retailer was unwilling to fill the former Kmart building. But as Senior Planner James Michaels put it, it’s better than nothing.

“It’s been vacant three years so you kind of think, what are the options?” said Michaels. “You know, we tried to encourage big box businesses to come in but we hadn’t heard anything, any interest from a Target or anything that would be willing to come in. The thing I like about it is at a very minimum we’re getting two new commercial users that we don’t even have in Ceres.”

Oryom Ventures, LLC, and Doya Ventures, LLC, won approval earlier this year to adjust the property line shared between the two properties at 1351 E. Hatch Road and 1319 Herndon Road. 

The applicant, Evergreen Devco, Inc. began contacting staff in January indicating that they had purchased the property to redevelop the site with multiple commercial users.

The six new lots will range in size from 0.36 acres to 4.88 acres. 

The Public Storage self-storage facility will be situated on 4.88 acres, which includes 45 parking spaces with landscaped areas. Public Storage also plans to build four additional buildings sized at 22,121, 5,041, 2,481 and 2,481 square feet, for a total storage area of 116,624 square feet.

The 3,267-square-foot Raising Cain’s will be located close to Hatch Road on 1.38 acres with a drive-thru operation and 83 parking spaces.

The building for the Dutch Bros. coffee shop will be smaller at 950 square feet with the 0.60-acre parcel accommodating a drive-thru operation and 13 parking spaces.

The 5,828-square-foot Quik Stop building and gas island is proposed to be constructed just east of the existing bus stop along Herndon Avenue. The Quik Stop building will be sized for an additional retail use. While the architectural renderings show the building with signs for Sbarro Pizza, Michaels is unsure if they were just placed for illustrative purposes. The Quik Stop parcel of 1.09 acres has been drawn with 47 parking spaces.

Two other parcels have not been claimed by any specific businesses but are earmarked for a 2,500-square-foot restaurant with drive-thru; as well as a 1,500-square-foot oil change shop. Michaels said the developer believes it can easily market those sites for users.

In its report to the commission, city planning staff supports the project “as it creates potential business opportunities for Ceres, it will provide the local area residents with additional shopping opportunities, and it will provide attractive building frontages that are readily visible from Hatch Road, Herndon Avenue, and Highway 99.”

An economic impact study of the proposed development indicates that the project will be valued at $20 million once completed with the potential to bring the city over $37,000 in annual property tax revenue alone and over $119,000 in sales tax revenue and more than $10,000 in sales tax revenue generated by what the employees of those businesses will spend in Ceres.

According to Michaels, other groups had approached the city about only turning the Kmart shell into a mini-storage facility without doing anything with the rest of the property and were told no.

Ceres resident Cynthia Loftin addressed the commission on Monday but while she likes the idea of adding businesses Ceres doesn’t have wondered how a storage facility fit with the Hatch Road Shopping District. She also questioned why a new Quik Stop would be placed near the newly expanded 7-Eleven. Loftin suggested new grocery stores would be a plus since Rancho San Miguel left Hatch Road years ago.

Sonia Escobar, whose house backs up to the former Kmart property, expressed concerns about addition noise and lighting coming from the self-storage. She was told that the area behind a self-storage facility would be much quieter than that behind a retail operation.

Rod Collins with Evergreen Devco said his company wanted to re-tenant the Kmart building for retail use and while they came close to snagging Sprouts Farmers Market, the company eventually walked away.

“The building is a little bit obsolete from a retail perspective these days, and unfortunately we planned to try to put a market in there but they turned it down,” said Collins. “The big box retailers in COVID just weren’t doing deals. Their interest is starting to shrink … and to endure 84,000 feet became very difficult to do.”

Six months into the effort, Public Storage expressed interest. While it wasn’t the kind of use desired, Collins said placing new businesses along the Hatch Road frontage makes the project more attractive to the community.

“It’s different, certainly, from what we were expecting but given the state that we are in these days in the retail world, I think it’s a very good result.”

Kachel wondered why Quik Stop should locate on a corner where two gas stations already exist, one being Chevron at the southwest corner and 7-Eleven to the northwest. Collins said gas stations are typically the users who can “pay the high premiums” to be on busy corner lots and Quik Stop was interested.

“This is a best in class user as well but … to make it work from an economic standpoint we need the gas station in there as well,” said Collins.

He added that it’s not uncommon to see gas stations on multiple corners of a busy intersection and often they foster price competition.

Michaels said he believes the public will be excited about Ceres getting a Raising Cane’s Chicken and a Dutch Bros Coffee.

Raising Cane’s first opened in 1996 in Baton Rouge, La., and has recently expanded into the Bay area and the Central Valley market with restaurants in Manteca, Fresno and Tulare. Locations are planned for Berkeley, Hayward, Citrus Heights, Elk Grove and Stockton. The restaurant serves chicken fingers, French fries, coleslaw, and Texas toast.